Brazil's national plan to expand broadband coverage to 70% of the population by 2014 will require know-how and investment from European firms already there, operators heard at an EU-Brazil conference in Brussels last Wednesday (22 September).
But concerns remain over regulatory barriers in the country. "Regulation is the biggest barrier to investment in Brazil," Mario Girasole, vice-president of public affairs at Italian telecoms company TIM's Brazilian subsidiary said, describing the fiscal burden imposed on foreign companies as "a sensitive issue".
Despite the fact that the Brazilian telecoms sector has been liberalised since 2002, domestic firms such as Telebrás still control up to 80% of the market in some regions, preventing de facto new entrants from setting up operations.
A Brazilian telecoms law still prohibits a partner of a company from having more than 5% of the assets in another group of the same sector, penalising foreign firms wanting to expand to the South American country.
"We hope that Brazil will not make the mistake of imposing barriers to investment in telecoms," said Kaisa Olkkonen, vice-president of Nokia's European affairs office, referring to a bill currently before the Brazilian parliament to decide whether or not to scrap restrictions on foreign capital for cable TV providers.
Ahead of elections in the country in early October, the next Brazilian government "should fix the problem of tax burden," said Augusto Gadelho, current vice-minister for science and technology.
Recent research by the Pyramid Foundation suggests that public investment will in fact go against the government's aims of extending broadband coverage to poorer regions of the country.
In 2007, Brazil decided to launch the Japanese-designed ISDB-T digital TV standard over the EU-backed DVB-T version, excluding the possibility of having a common product range for broadband and mobile services provided by Brazilian and EU telecoms firms.